When your company does business abroad it is important to understand how different countries deal with payments. There is a chance that your customer in Spain will not pay, for example. The economic crisis has made its contribution to the enormous increase in cases of nonpayment. What can you as creditor do?
1. Demanding payment
When your Spanish customer does not pay, you can send a claim for payment. It is important that the claim include an order/order confirmation, a waybill or bill or lading, and an invoice. Also, the general terms and conditions must be given to your customer in the correct way. The general terms and conditions must conform to both Dutch and Spanish statutory requirements and must not allow any room for dispute. If you customer does not pay within the term for payment you can contact the customer and send a demand for payment. Be tenacious, clear, and fast: Spanish debtors frequently try to gain time with vague arrangements for payment or disputes.
2. Assigning claims
Transfer the problem to Bierens Collection Attorneys when your customers don’t pay, even after formal demand. Bierens has a Spanish department in Amsterdam and its own office in Barcelona. Our employees have a perfect command of English and Dutch and Spanish, so they can fruitfully discuss your case with you and make collections in Spanish. Equally important, they are also well up on Spain’s laws, regulations, and its culture.
3. Dealing with collections in Spain
The Spanish legal system differs in a fundamental way from the Dutch legal system. In Spain protection of the debtor has priority. In the Netherlands the creditor enjoys the most important protection.
A. Extrajudicial collections
The lawyer will make both a written and a telephone demand upon the debtor for payment. If the debtor does not pay within the deadline set, legal action will be brought after consultations with you.
B. Court-ordered collections
All actions in Spain involving an interest greater than €2,000.00 must be brought by a lawyer and an attorney of record. They must show the court proof of their authority to represent you. They must submit a power of attorney executed before a civil-law notary.
There are different ways to bring legal action in Spain:
Proceso monitorio procedure
Processo monitorio is Spain’s order compelling payment. This action is relatively quick and inexpensive. The debtor is given a demand to make payment within twenty days or to raise a defense. In the absence of a defense judgment can be pronounced quickly. When there is a defense, a thorough action on the merits can be pursued.
Jucio Verbal procedure
Under the jucio verbal, after a summons is served the court schedules a session and issues a judgment no more than six weeks later. This proceeding is for claims up to €6,000.00.
Jucio Ordinario procedure or, an action on the merits
The Jucio Ordinario is used for claims greater than €6,000.00. This is a very thorough procedure, and can take one to two years.
Jucio cambiario procedure
Spain has a separate form of proceeding when your claim is based on an unpaid check or bill of exchange, the Jucio cambiario. A demand is made for payment within ten days and provides for the simultaneous attachment of the debtor’s property.
It is possible to apply for measures for a pre-judgment attachment before bringing legal action. This would require simultaneous urgency and necessity. Measures for pre-judgment attachment could then be granted in the subsequent action without the counterparty being heard. While Spanish law provides for this possibility, in practice the courts usually want to hear the counterparty. Attachment also requires the claimant to post collateral.
Spain has an insolvency proceeding that applies both to civil law debtors and to commercial debtors.
The insolvency proceeding can be instituted at the request either of the debtor or of the creditor, or at the request of partners personally liable for the debts of a partnership who apply for the institution of an insolvency proceeding,
The law requires a number of external facts for a creditor’s application to be accepted:
- The total suspension of payment obligations.
- The cessation of payment of tax assessments and social insurance assessments and/or salaries in the three months prior to the application for bankruptcy.
- The unsuccessful conclusion of enforcement proceedings based on a title or judgment.
- Property removed from the liquidation assets or a hasty sale of property yielding no proceeds.
5. Advice about debt collection in Spain
Would you like more information about collections or bringing legal action in Spain? Email firstname.lastname@example.org or telephone +31 20 312 11 00.
This website is about sharing knowledge. But if you have a claim to recover, you can go to the website of Bierens Debt Recovery Lawyers. For claims submitted by 4pm, a demand letter is sent the same day.